Love may be in the air but sooner or later someone has to pay the bills.
Here are some simple strategies for enjoying a debt-free wedding day and a financially equal life with your new life partner.
Wedding = one day; your life together = a lifetime
Who does not want a terrific wedding? But you really need to look beyond the confetti and those tinkling glasses to your long-term financial life. Plan for a happy wedding but within a reasonable, affordable budget. Use the wedding budget process as a learning exercise for you and your partner to work together toward a shared financial goal.
Wedding costs = real money
Pay for your wedding with money you have saved instead of through credit cards or stealing from your investments or retirement fund or you will end up paying for your wedding over and over again for many years. For example, put $25,000 in wedding expenses on your credit card at 14-per-cent interest and only make the minimum payment each month and it will take you 100 years to pay it off!
Financial plan = stick to it
Set a wedding budget based on the money you will have at the time and start saving right away! While you are at it, set other financial goals like accumulating a down payment for a new home and begin saving and investing for those goals, too.
Here is a simple wedding dreams to fiscal reality budgeting template to get you going:
• How much debt is each of us bringing to our marriage? $__
• How much money do we have saved? $__
• What is our combined monthly income (salary and/or other income) $__
• What are our monthly costs (mortgage/rent, food, cleaning, personal products, phone, cable, electricity, travel expenses — car, gas, parking, etc. — insurance, taxes, bank loans, credit card payments, entertainment, etc.)? $__
• How much can we afford to put into our wedding fund monthly
(including the rings, and a honeymoon)? $__
How much can we afford to save/invest for our other “dreams”? $__
Put those numbers in place and you will know if your wedding budget is realistic or needs a second look, how long it will take to get to a debt-free wedding date, and when you will be able to turn your other financial dreams into reality.
J. Kevin Dobbelsteyn is a certified financial planner with Investors Group Financial Services Inc. His column appears every Wednesday.